Financial​ Fears: What First-Time Parents​ Worry About

There's no getting around it: Babies are expensive. Here's how to make sure you're financially set for baby's arrival—and future.

Saving up for baby may seem like an impossible task. But with four million babies born each year in the US, parents are finding a way to make it work. They key is planning ahead.

"I’ve found that first-time parents all find themselves confronting the same three financial questions," Voya financial adviser Joe O'Boyle tells TIME. "The great news is that all three of these questions can be answered with a little bit of planning." They include:

How will we afford this baby?

How will we pay for college?

What if something happens to us?

One at a time, O'Boyle tackles these questions:

Affording a baby

O'Boyle says that while a newborn involves plenty of unexpected expenses, daycare, diapers and baby food make up the bulk of your purchases. "By increasing your monthly contributions to a liquid investment savings account, you can get a head start on changing your spending habits and begin to prepare for costs you know are coming," he says.

Paying for college

Hoping your future athlete will score a full ride to a Division I school? Be sure to have a backup plan too.

"If you want to put your money to work, start saving early and take advantage of time and compound returns. A 529 college savings plan offers you 100 percent federal tax-free growth for qualified higher-education expenses," says O'Boyle. Friends and family can help out too; encourage them to contribute to the 529 plan rather than giving baby toys or presents.

Contingency plan

You know baby will be completely dependent on you. But what if you can't be there to care for her? Planning for worst-case scenarios is tough, but it boils down two major points: who will take care of your child and who will pay.

An estate planner can help you determine guardianship instructions and things like distribution of assets. Your life insurance will pay your child (or his guardian) a lump sum upon your death. Having trouble choosing a policy? "Term life insurance is typically the least expensive, and thus the most common, option; you pay a set amount each month over a certain number of years, and in turn are guaranteed a death benefit should you die during that term," says O'Boyle.

Ultimately, expanding your family is exciting and shouldn't trigger an existential crisis. But planning ahead is important. Get more tips for saving up for baby here.